Safe Investment Company (SIC)began Operations on January 1,2016

question 10

Multiple Choice

Safe Investment Company (SIC) began operations on January 1,2016.It acquired the following investments:

SIC earned interest of $12,000 during 2016.Dividends of $16,000 were declared on the shares it owned during 2016.Of that amount,$9,000 was received in December 2016 and $7,000 was received in January 2017 (note that the ex-dividend date for these shares was prior to the end of the year) .At what value would SIC's bonds (which were purchased at par) be recorded at in the balance sheet on December 31,2016?

• A)$183,000
• B)$195,000
• C)$198,000
• D)$207,000

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Definitions:

Public Companies

Companies whose shares are traded publicly on stock exchanges, allowing for wider ownership by investors.

Violated

Breached or transgressed, referring to a situation where laws, rules, or agreements are not followed.

Deregulation

The process of removing government restrictions and regulations in a sector to allow for more competition and efficiency in the market.

Pharmaceuticals

Products developed by the pharmaceutical industry for the purpose of diagnosing, treating, curing, or preventing diseases.